PACRA Maintains Asset Manager Rating of MCB Investment Management Limited (Formerly: MCB-Arif Habib Savings and Investments Limited)

MCB Investment Management Limited (Formerly: MCB-Arif Habib Savings and Investments Limited) (or the 'Company') is amongst the largest leading players in the AMC industry, supported by a strong control environment, structured investment processes, good governance framework, and qualified management team. The assigned rating takes into account improvement across key performance areas including investment management, fund performance, control framework, and growth & diversity in assets under management. The rating reflects the sizable growth in the AUMs of the Company, which have increased by ~25.4% at the end of Jun'23 on a YoY basis. The market share stood at ~9.5% at the end of Jun'23. The growth is expected to continue with management focusing on customer service enrichment. The AMC has won best digital customer service award and best CRM technology award at Pakistan Digital Awards 2023. The Company is managing one of the largest AUMs portfolios and holds a significant share of the investment advisory domain. With a portfolio of nineteen open-end mutual funds and two voluntary pension schemes, the Company offers a wide range of products for its customers. The Company’s association with MCB Bank Limited – one of the largest commercial banks – and ensuing synergies have supplemented growth. The funds have shown consistent and good long-term performance compared to peers. The profitability of the Company has improved notably in FY23 due to improvement in overall AUM base and related fee rate from the collective investment schemes and stood at PKR ~378.2mln (FY22: PKR ~173mln). The company enjoys sound liquidity and has sufficient lines available if the need arises. The equity base of the company is well above the minimum regulatory requirement and stood at ~PKR 1.7bln as at end-Jun'23 (FY22: PKR 1.4bln).
The rating is dependent upon the Company’s ability to sustain its market share and upholding strong investment processes and control environment. Meanwhile, consistent performance of funds compared to benchmark and peers is critical. Any sustained downturn in fund performance and/or significant loss in market share will impact the rating.

About the Entity
MCB Investment Management Limited (Formerly: MCB-Arif Habib Savings and Investments Limited (MCBIM or the "Company") is a Public Listed Company, regulated by the SECP. MCBIM holds licenses for Asset Management, Investment Advisory, and Pension Fund Management. MCBIM was incorporated in 2000 as Arif Habib Investment Management Limited and subsequently merged with MCB Asset Management Company in 2011, to achieve synergies in asset management business and access to a wider distribution network. Pursuant to the merger, the name of the Company was changed to MCB-Arif Habib Savings and Investments Limited. On Apr'23, MCB Bank Limited (MCB), being the parent company of MCB-Arif Habib Savings and Investments Limited, has acquired 30.09% shares of MCB-AH from Arif Habib Corporation Limited (AHCL). By virtue of this transaction, MCB Bank Limited’s shareholding in MCB-AH has increased from 51.33% shares to 81.42% and AHCL no longer holds any shares in MCB-AH. Resultantly, the name of AMC has been changed. MCBIM caters to both conventional and Shariah-compliant clientele and is currently managing a diverse product slate of nineteen open-end funds and two voluntary pension schemes. The major shareholders of MCBIM are MCB Bank Limited ~81.42%, and Adamjee Insurance Company Limited ~7.6%. The general public holds the remaining ~11% of the shares. Resultantly, the board of AMC has also been changed.